'Letters becoming words' sounds somewhat like an auto-correct function. Did you download and install a program recently that might've triggered such function?
Define "crazy", maybe people can help you then. :)
I have a laptop like that, only mine was self-induced. When the current keyboard in it was put in, the original was doing similar things. It turned out to be a wiring harness problem. With the current keyboard, I'm afraid it'll be major fix-it time as I let a whole cup of coffee spill into it. Even after the drying out, only half the board works, so I have an external board when I need to use the laptop. My bigger headache is that the laptop is no longer updatable with my Mac OS as it was a first Intel processor. Does anybody know if a processor transplant can be done?